Center Parcs is a holiday village operator in the hotel and leisure sector that offers full equipped accommodation in forest locations. The villas offer a range of indoor and outdoor activities with a variety of amenities like retail outlets and restaurants on offer (Center Parcs). The paper will provide a brief overview of the Center Parcs villas outlining its market products & profile, what influences its business using the PEST model and some of the managerial challenges that are encountered and how best to develop strategies for the challenges.
Center Parcs Market Product
Center Parcs is a network of holiday villages that runs several holiday villages in numerous locations in the UK. The company offers high quality accommodation in apartments, lodges and villas set in a forest each with its own unique private patio. The Parcs offers a range of retail outlets, restaurants, indoor & outdoor sports, leisure facilities and a mix of bars themed in a natural environment although water and woodland are the main vital elements (Center Parcs Business Profile).
Center Parcs is one of the earliest attractions in the UK that blurred the specificity and importance of tourism based on selling nature experiences. Center Parcs is an example of a staged vocational environment that seeks to transcend the dichotomy between natural environment with the urban life (with both indoor and outdoor experiences). Center parks mainly use landscape in its marketing strategy (open lawns, forest patches and water bodies) with such urban elements like the apartments and pools are also used in the marketing strategy. The urban elements are carefully integrated and presented often as a subsidiary theme. Therefore, Center Parcs is presented as a staged attraction site that addresses tourists with that wish of escaping the city for nature but with the promise of safety and comfort (Coles and Hall, 2008, p72).
The company mainly uses direct marketing. This is due to the fact that more guests are repeat visitors. The company communicates with guests in different ways; informing their guests of village improvements, encouraging repeat booking and booking incentives during off-peak periods. Communication is done by mail, telephone and post although technology has revolutionized the company as it uses Facebook and Twitter to pass some important messages (Center Parcs Business Profile).
Center Parcs are also known to use online marketing strategy. The company has a flexible online booking process and its activity bookings digital campaign compliments its offline strategy in its campaign to ‘go green’ but at the same time encourages people to go online and book their on-site activities. Center Parcs marketing efforts had previously lacked targeting accuracy. It is reported that twice each year, Center Parcs could blanket the UK with excess of 5 million brochures. Although the strategy worked, the company spent a lot of money not only on printing the brochures but also on mailing costs. Although Center Parcs attracts more than 3 million guests each year and generating revenue in excess of $600 million, the company believed that a more targeted campaign will raise its occupancy rates from 90 percent to even higher rates while introducing marketing costs. Thus the company’s aim was to shift from bulk emailing to using a smaller and more targeted campaign. The company therefore segmented customers enabling them to receive the right brochures at the right time, an example in point being customers who are loyal to their home countries and could prefer not to drive longer distances or families with children who would prefer parks with many activities in there or for older people seeking quieter paces to relax (Rainer and Turban, 2008, p.271).
Center Parcs exactly knew what drove customers to their parks and the criteria above were rather obvious but the company could not find a way to take the above criteria into account. It later came up with a rating that could indicate which brochures to send to which customer and the time to do so. The company utilized a SPSS program, predictive-analysis software, which uses statistical formulas to find patterns that can predict the future. The program as a result was used to predict future action and predict the likelihood of a customer repeating a purchase soon by using Center Parcs’ customer database to rank their likelihood that they will visit the park. Therefore, when the company could want to mail a brochure about a facility, it could make use of the predictive analytics application that produces a list of prospects who are likely to respond. The results were outstanding and in this way they reduced their brochures while increasing occupancy by 10 percent (Rainer and Turban, 2008, p.271).
Therefore, it can be seen that an important philosophy of the company is the “care and development of nature and environment in general” and this is what guides and directs the company’s every aspect of its operations. Center Parcs has shown that it is possible to sensitively design and enhance wildlife even by large tourism activities. These positive aspects of Center Parcs concerning its environmental policies have not gone without recognition as a number of significant awards have been awarded to the company (Buswell and Williams, 2003, p16).
Managerial Problems and Challenges
Problems and Challenges
Some of the reported problems encountered by guests are as listed below:
- To save customer time by encouraging guests to pre-book holiday activities before they arrive
- To increase customer experience and increase its relevancy
- Another challenge is to increase income proceeds for the company from pre-booking (Case study, p1).
The above managerial challenges can be tackled by first splitting emails by location and then highlighting activities and any other promotions. The result here is that
For the case of increasing customer relevancy and improve customer experience, then Center Parcs should modify emails to highlight its different activities and promotions all depending on guests arrival (Case study, p1).
For the case of increasing revenue from pre-bookings, the company should set up automated feeds between its own database and its eCircles eC messenger mail. Ecircle is one of the UK’s biggest digital direct marketing companies. It owns most comprehensive permission for marketing database for emails campaigns and lead generation in state of the art technology solution in direct marketing. This will help to trigger daily emails. Revenues from pre-booked activities can increase to more than 80% of the pre-booked activities. The pre-booked activities are now made online (Case study, p1). Some of the biggest managerial challenges facing the park are:
A Daily Mail reporter reported on January 2010 that the Center Parcs villas are meant to liberate people from the stresses of urban life but they have sown a city curse: crime.
Cases of thievery have been on the rise in most Center Parcs resorts in the UK. According to Levy Andrew, the Daily Mail reported that one of the resorts was forced to hire its own police officer after it was allegedly reported that hundreds of guests’ bicycles were stolen. The resorts are supposed to offer the chance for guests who are escaping urban life by getting them to park their cars or bicycles by walking around. But it was reported that at Elveden resort at Suffolk, 362 bikes worth about £300,000. It is further reported that during the same period the bikes were reported stolen, another valuables worth about £270,000 were reportedly lost due to burglaries at the villas. The thieves broke into one of the villas and stole ipods, mobile phones, laptops, digital cameras, unknown amount of cash and other valuables (Andrew, 2010).
Appropriate Strategy to Stealing
Resort managers need to meet the country’s police chiefs and report the losses so that further security measures can be taken. It seems that the villas are being targeted by a gang of organized gangs. They should think of funding a Police Community Support Officer which will act as a deterrent to the thieves (Andrew, 2010).
The villas should also boost their own security. It was reported by the Daily Mail that the villa has dedicated services of a police officer by the name Suzanne Ashford who is to be funded by Center Parcs. She is reported to have followed a suspected thief and in turn recovered 11 bicycles and two more other arrests were made. The park should also assist in using its resources to ensure customer security is guaranteed. They should concentrate on security fencing, use of CCTV cameras and increased patrols by their security personnel to tackle the crimes. The use of a security specialist will also come in handy.
I believe that hiring a security officer full time should be an immediate action while the act of fencing a whole villa will take some time, maybe a year or less. Experts should be hired to fence put fences around the villas while CCTV cameras are being installed. By doing this, guests who have lost their valuables will increase their confidence of the park and make follow up visits.
Diminishing Quality on a Number of Things in the Park
Center Parcs has been on an expansion program during the last two decades but some customers have noticed that most areas of the park that were forested have been cleared to accommodate more villas to make room for more people. This has not augured well with many guests who want to enjoy the park with fewer villas but more forest cover.
Guests have also complained that despite an increase in prices, the quality of foods at the villas have not changed or have reportedly gone down. This makes a less comfortable stay at the villas. Some customers have even resorted to carrying their own foods to the villas; this has a negative effect on the resorts as they will likely lose on revenue.
Appropriate Strategy to the Low Quality
Overall, the park needs to increase the quality of its services at all is villas to continue attracting more guests and be able retain them. Concerning the expansion program to build more villas at the park, this should not be done at the expense of nature’s luxury that the park affords. A balance should be drawn between accommodating more guests and affording them nature’s luxury that they need.
With the recession in 2008 and a looming one in 2011, the park was justified in increasing meal prices but they should be cautious not to have abnormal increases that will drive their customers away or make them carry their own packed foods. However, management should look improving the quality of foods served at the parks so that it is not seen as they are robbing customers.
PEST analysis means analysis for ‘political, economic, social and technological.’ It is very important for an organization like Center Parcs as this are the factors that may affect several vital variables in a business (PEST analysis and Center Parcs).
The company has been able to gain success due to its good reputation and trust by considering its political and legal sectors as part of their strategy. For any company to succeed it needs to follow given policies to be considered a legal and authorized business, to which Center Parcs has done. Center Parcs having their villages in Europe work in a stable political environment (PEST analysis and Center Parcs).
It is important that Center Parcs gives enough attention to its economic stability. Although the general economic condition in the UK being a developed country is that it has a pool of wealthy clients, the 2008 recession saw people’s income eroded and in that case the company needs to plan ahead for such eventualities (PEST analysis and Center Parcs).
In the UK, tax applies on everything that is bought. This means that increasing costs in the UK is a big threat to Center Parcs which is likely to pass the extra burden to customers.
The company operates in compliance with the country’s social system and has been able to gain good reputation and a good effective public image. As a result, Center Parcs is a socially accepted place and many love it. Most of the guests at the villas ride around using bikes which is a friendly alternative form of getting around. People love the experience as it is a “cool” thing to do and the company can be negatively affected if it becomes “un-cool” (PEST analysis and Center Parcs).
Advances in technology have had a major impact for Center Parcs on its model business and helped it to stay afloat. The internet has had a way in which the company’s consumers are able to keep research about the business and get instant updates on the on goings or be able to purchase products online. The company has capitalized on the use of internet to reach its customers and help them participate in online booking through their website http://www.centerparcs.co.uk.
Technology especially the use of the SPSS program earlier seen has also enabled Center Parcs to reduce its overhead costs (like that of printing many brochures). The use of solar panels to heat the villas has also seen a big reduction for its overhead costs (PEST analysis and Center Parcs).
The paper has discussed about Center Parcs, a tourist destination in the UK. The resorts are famed for providing luxury outside the city in high quality villas at their natural surroundings. Center Parcs are also known to use online marketing strategy to book their customers and also encourages their customers to use online booking. The company mainly uses direct marketing due to the fact that more guests are repeat visitors.
Due to the fact that the parks are situated in the UK, a PEST analysis indicates that Center Parcs villages operate in a stable environment and thus expect less or no disruptions of their businesses. Economically, increasing rates in the UK is a real threat for the parks as they also get taxed for everything bought as well as VAT. Due to their culture, the parks are loved by people and a spot check indicates that they have more than 90% occupancy rates. Lastly, new technologies have enabled Center Parcs to reduce overheads by use of solar panels while increasing occupancy rates.
The parks however have had some of the biggest managerial challenges. Crime especially in the form of stealing of guests’ bikes and other valuables is a big challenge for the resort managers. It was reported that the 362 bikes were stolen from the park in a span of two years from one of villas. Other valuables were also reputedly stolen angering guests who usually use bikes instead of cars to navigate the parks. Another problem has been decreased quality of services for the guests. The customers have complained of low quality meals and a decreasing forest cover preferring more villas instead. With the suggested strategies, Center Parcs can again reclaim its glory and continue being the best tourist attraction park in the UK.